Rationalizable implementation in finite mechanisms

Yi-Chun CHEN
Takashi KUNIMOTO, Singapore Management University
Yifei SUN
Siyang XIONG

Abstract

We prove that the Maskin monotonicity condition (by Bergemann, Morris, and Tercieux (2011)) fully characterizes exact rationalizable implementation in an environ-ment with lotteries and transfers. Different from previous papers, our approach possesses many appealing features simultaneously, e.g., infinite mechanisms with no integer game or modulo game are used; no transfer is imposed on any rationalizable profile;the message space is small; the implementation is robust to information perturbationsand continuous in the sense of Oury and Tercieux (2012).